Corporations require regular and ongoing filings with the state, including fees associated with these filings.

Frequently Asked Questions

Why should I incorporate my business?

As previously mentioned, there are several benefits to incorporating your business. Most important is the fact that corporations offer protection of your assets. Corporations also allow their owners to separate their personal assets thus protecting them from personal liability over the corporation’s debts and liabilities.

If you are strictly looking to invest funds, then you’ll want to establish a C corporation. If you have fewer than 35 shareholders, you’ll want to establish an S corporation.

Where should I incorporate?

The state where you choose to incorporate is entirely up to you and your business needs. It will be cheaper to incorporate in your home state. More specifically, if you incorporate in your home state, you are not required to pay franchise taxes or file yearly reports in more than one state. However, most business owners choose to incorporate in the state where they intend on operating the most. For those businesses operating in multiple states, you can incorporate in one state and then register in those additional states, meaning that you will then be required to register, file annual reports, and pay annual fees associated with each state’s requirements.

How do I incorporate my business?

Contact the state’s secretary of state that is responsible for registering corporations.

If you choose to hire an attorney, you can. However, with a little guidance from various literature, you can do so on your own, which will save you money.

Choose a business name, but keep in mind other requirements when choosing a name, including not being able to use words associated with the federal government, i.e. Federal, Reserve, Bank, United States, etc.

After registering with your respective state, you’ll need to register with the IRS and obtain an Employer Identification Number (EIN).

A corporation will need to create bylaws that specify in detail how the corporation will be run.

Choose a board of directors.

Draft a shareholder’s agreement.

Hold a meeting where you will go over all important decisions regarding the daily operations of the business, including a tax accounting method, appoint officers, incorporate and adopt the bylaws, issue shares of stock, as well as other key topics to be discussed during the meeting.

Should your business be issuing shares of stock, you should not open your doors for business until you do so.

If you need additional help incorporating your business, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Stripe, and Twilio.

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